1

Squeezing the Value out of the Old Annoying Orange

I believe that most in the software business believe that it is tough enough to calculate and hence financially justify the purchase or build of an application - especially middleware – to a business leader or even a CIO.  Most of business-centric IT initiatives involve improving processes (order, billing, service) and visualization (scorecarding, trending) for end users to be more efficient in engaging accounts.  Some of these have actually migrated to targeting improvements towards customers rather than their logical placeholders like accounts.  Similar strides have been made in the realm of other party-type (vendor, employee) as well as product data.  They also tackle analyzing larger or smaller data sets and providing a visual set of clues on how to interpret historical or predictive trends on orders, bills, usage, clicks, conversions, etc.

Squeeze that Orange

Squeeze that Orange

If you think this is a tough enough proposition in itself, imagine the challenge of quantifying the financial benefit derived from understanding where your “hardware” is physically located, how it is configured, who maintained it, when and how.  Depending on the business model you may even have to figure out who built it or owns it.  All of this has bottom-line effects on how, who and when expenses are paid and revenues get realized and recognized.  And then there is the added complication that these dimensions of hardware are often fairly dynamic as they can also change ownership and/or physical location and hence, tax treatment, insurance risk, etc.

Such hardware could be a pump, a valve, a compressor, a substation, a cell tower, a truck or components within these assets.  Over time, with new technologies and acquisitions coming about, the systems that plan for, install and maintain these assets become very departmentalized in terms of scope and specialized in terms of function.  The same application that designs an asset for department A or region B, is not the same as the one accounting for its value, which is not the same as the one reading its operational status, which is not the one scheduling maintenance, which is not the same as the one billing for any repairs or replacement.  The same folks who said the Data Warehouse is the “Golden Copy” now say the “new ERP system” is the new central source for everything.  Practitioners know that this is either naiveté or maliciousness. And then there are manual adjustments….

Moreover, to truly take squeeze value out of these assets being installed and upgraded, the massive amounts of data they generate in a myriad of formats and intervals need to be understood, moved, formatted, fixed, interpreted at the right time and stored for future use in a cost-sensitive, easy-to-access and contextual meaningful way.

I wish I could tell you one application does it all but the unsurprising reality is that it takes a concoction of multiple.  None or very few asset life cycle-supporting legacy applications will be retired as they often house data in formats commensurate with the age of the assets they were built for.  It makes little financial sense to shut down these systems in a big bang approach but rather migrate region after region and process after process to the new system.  After all, some of the assets have been in service for 50 or more years and the institutional knowledge tied to them is becoming nearly as old.  Also, it is probably easier to engage in often required manual data fixes (hopefully only outliers) bit-by-bit, especially to accommodate imminent audits.

So what do you do in the meantime until all the relevant data is in a single system to get an enterprise-level way to fix your asset tower of Babel and leverage the data volume rather than treat it like an unwanted step child?  Most companies, which operate in asset, fixed-cost heavy business models do not want to create a disruption but a steady tuning effect (squeezing the data orange), something rather unsexy in this internet day and age.  This is especially true in “older” industries where data is still considered a necessary evil, not an opportunity ready to exploit.  Fact is though; that in order to improve the bottom line, we better get going, even if it is with baby steps.

If you are aware of business models and their difficulties to leverage data, write to me.  If you even know about an annoying, peculiar or esoteric data “domain”, which does not lend itself to be easily leveraged, share your thoughts.  Next time, I will share some examples on how certain industries try to work in this environment, what they envision and how they go about getting there.

FacebookTwitterLinkedInEmailPrintShare
This entry was posted in Application Retirement, Big Data, Business Impact / Benefits, Business/IT Collaboration, CIO, Customer Acquisition & Retention, Customers, Data Governance, Data Quality, Enterprise Data Management, Governance, Risk and Compliance, Healthcare, Life Sciences, Manufacturing, Master Data Management, Mergers and Acquisitions, Operational Efficiency, Product Information Management, Profiling, Telecommunications, Transportation, Utilities & Energy, Vertical. Bookmark the permalink.

One Response to Squeezing the Value out of the Old Annoying Orange

  1. Lisa says:

    Stephan – Great summary of real concerns, with a ton of costs (hard and soft) attached that must be tackled to meet market and customer demands. Thank you.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>